Demo Trading Binary Options – Cons and Pros
Don’t know how the broker’s platform works? Not sure whether your new strategy is going to work or not? Then a demo account is definitely what you need. Before you jump into the sea, you might wanna practice in a swimming pool first, right? Trading binary options is risky and one little error could mean “good bye Lamborghini and nice house near the beach”. So before you blow your account, see how fast you can lose money by trying out the demo account! Scared now? Good, so keep reading, I’ll tell you how to take advantage of the demo so you can keep dreaming about sports cars.
Demo Account – Where Can I Get One?
If you still haven’t figured it out, a demo account is an account that looks exactly as the real thing, same functions and all but with virtual money. Some brokers offer them, others don’t.
The ones who don’t offer them might give you all sorts of silly reasons for why they don’t “have” a demo account. Like; “it’ll slow down our servers”. Really? making millions every day, yet you guys can’t afford to rent a couple more servers for a few bucks? Sometimes you can convince them to give you a demo account if you keep insisting on needing one. Most of the brokers that do offer a demo account want something in return, a minimum deposit for example… or your soul. Haha, okay maybe not your soul but at least your details and information.
Anyway, I personally believe that if you pick a broker and make the minimum deposit and they encourage you to only demo trade before you touch your live account then you’ve chosen a good broker. However, they should also let your first withdrawal be FREE, so if you are done demo trading and don’t want to trade anymore or don’t like the broker you get to leave without any charges! Even better if the demo account has no time limit so you can patiently try out the platform and test different strategies as long as you desire! Beware of money limits though, as that is a common way for brokers to make you deposit more real money in order to get more virtual cash for your demo account once the initial amount is depleted. You still need to apply money-management so you can keep the demo account running as long as possible. Read more about the benefits of binary options demo accounts here.
Demo – Unlimited Benefits?
Okay, now that you’ve sold your soul to get a demo account (hopefully not) you need to know a few things about demo trading. Perhaps you didn’t expect this but even demo trading has its drawbacks!
Yes, it’s true… You’ll never have the same feelings towards trading demo money as the feelings that you’ll have trading with your own money that you’ve worked so hard to save. The level of stress can be significantly different in a live account and change everything, one moment of hesitation and you’ll execute a trade too late or too early and it will turn out totally different than it would have on a demo account. When trading on a demo you are relaxed, confident and have no attachments to the virtual cash balance. To experience the real thing one day you will need to quit demo trading. That’s when your journey to becoming really skilled starts.
I remember a period during which I both traded live and on a demo, I ended up taking my most profitable trades on the demo and my losses on the live account. Can’t tell you how much that sucked!!! Why? Because I hesitated when I took trades on my live account, got in too late, closed my in-the-money trades early because of fear of losing. On the demo I was confident. My strategy said go up, I took calls. My strategy said down, I took puts. No hesitation, no stress. Hence leading to a higher success rate on the demo. It wasn’t until I completely switched from demo trading to live trading that I became confident and honed my skills.
Conclusion – Warm Up With Virtual Training
Trading skills are gained through training and training can help you learn if trading is right for you. A demo will give you a chance to find out whether trading is something you really want to commit to. Before making a deposit with the broker of your choice, ask them about demo accounts and find out what the terms & conditions are and how you can get one! If you are already with a broker that does not offer a demo account, you can use the “Trade & Share” platform here in the CommuniTraders forum. Become a member and start practicing with us, no strings attached! Just remember, demo trading alone is not enough, one day you have to get out of the virtual market and get into the real one. See it from the bright side, at least you’ve warmed up without losing any money!